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Tax Incentives for Industrial Businesses

Alabama Power is passionate about leveraging knowledge gained from more than 100 years of service to help customers save money and develop their businesses. Alabama has some of the lowest taxes in the nation, and these special tax incentives can be a boon to your business.

Alabama Taxes

Property Tax

Alabama Property tax is 20% the fair market value on all real and business property. State millage rate on both real and personal property is 6.5 mills. Cities and counties may levy additional millage rates.

Income Tax

Corporate income tax is limited to no more than 6.5%, and corporations can deduct from the full apportioned amount of Alabama taxes paid.

Sales and Use Tax

Our general sales and use tax rate is 4%. The rate for manufacturing and farm machinery is 1.5%.
 

Business Privilege Tax

The tax base is the taxpayer’s net worth apportioned to Alabama. The tax accrues as of Jan. 1 of every taxable year, and is due Mar. 15.

Incentives

Incentives are also available for facility expansions involving chemicals, research, engineering & design, data centers, or metal / machining technology or toolmaking. Additional incentives are offered for counties with low populations or substantial veteran workforce. Contact our experts for more information on tax incentives.

For the first time, Alabama’s incentives cover capitalized replacement and maintenance property, as follows. The state, cities and counties have various programs to provide training and infrastructure as well as other incentives. Contact our experts for more information.

Jobs Rebate Cash

  • Annual cash payments for up to 3% of last year’s payroll for new employees.

  • Available for up to 10 years.

Utility Tax Credits

  • Cash refunds for incremental increase in utility gross receipts tax due to increased energy use.

  • Available for up to 10 years.

Abatements

  • Sales tax abatements on construction materials and manufacturing machinery (non-educational taxes).

  • Property tax abatements for up to 20 years (noneducational-taxes).

  • Abatements are generally available without creating 50 jobs.
    Tax abatements for state and non-educational local sales and use taxes on construction materials and manufacturing machinery.
  • Property tax abatements (non-educational taxes) for up to 20 years (limited to the incremental increase in such taxes if the property does not perform a new function).

 

Economic Development

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